The passing of the long awaited Companies Act in 2013
is probably the single most important development in India’s history of
corporate legislation, next only to the monumental Companies Act 1956
which it replaces. While significant improvements have been effected in
required standards of corporate governance, there is also some concern
of possible overreach making life more difficult for companies as well
as their independent directors. Among the major provisions of the Act
are those of restraining voting rights of interested shareholders on
related party transactions, recognition of board accountability to
stakeholders besides shareholders, and extension of several good
governance requirements to relatively large unlisted corporations. The
paper is organized in three sections. Section I briefly documents the
evolution of corporate governance in the country; section II sets out
how some of the key governance objectives are sought to be addressed by
the Initiatives; and section III concludes highlighting some areas that
still need further strengthening.
Realty bubble deflated, an oil town gets down to business
".....may force companies to consider other alternatives such as taking loans from banks instead of accepting deposits."
new rules, as understood, has the one basic objective of safeguarding
and protecting the interests of the investing public, mostly in the
category suffering from ignorance or imbecility , having no capacity to
know the nitty-gritty or not-so-obvious risk factors. Even if the "other
alternatives" were to be resorted by the invested companies,that would
have the same frightful consequences; the only difference being it is
the banks and stakeholders to whom the same risk factors would be passed
and be faced with.
As regards the mentioned requirements of
filing returns or documents with the ROCs, without the machinery of a
sophisticated kind in place to constantly scrutinize and keep monitoring
as a continuous exercise,it seems to be a mere empty formality, so
called paper-tiger, with no real purpose to serve.
Similarly , the requirement
obtain credit rating at regular intervals during the tenure of the
deposit", is at best, of nuisance value, again with no real purpose to
These , noted to have been simply glossed over in the
write-up, nonetheless , in one's perspective, do call for a rethinking
and drastic modifications of the new rules, seemingly framed with no
insightful examination of the intricate implications.